Using UberX, Lyft? Better check insurance, state says

Wednesday

Apr 16, 2014 at 12:01 AMApr 17, 2014 at 11:08 AM

The state is cautioning both riders and drivers to think twice before using smartphone-app-based car services offered in Columbus, Cincinnati and Cleveland. Lt. Gov. Mary Taylor, who heads the Ohio Department of Insurance, issued an alert yesterday warning consumers about potential insurance gaps that could leave them without coverage in a wreck.

Rick Rouan, The Columbus Dispatch

The state is cautioning both riders and drivers to think twice before using smartphone-app-based car services offered in Columbus, Cincinnati and Cleveland.

Lt. Gov. Mary Taylor, who heads the Ohio Department of Insurance, issued an alert yesterday warning consumers about potential insurance gaps that could leave them without coverage in a wreck.

The companies connect riders and drivers through a phone app that also processes credit-card payments. The app calculates the fare, and the companies keep a portion of the payment. The drivers use their private vehicles.

UberX and Lyft made their Ohio debut in Columbus in February and recently moved into Cleveland and Cincinnati as well. Questions about the insurance coverage they provide have followed the two San Francisco companies to many of the cities where they’ve launched service.

“We think that the positives of (the companies) far outweigh the negatives as long as the passenger and driver issues and insurance are properly addressed,” said Mary Bonelli, spokeswoman for the Ohio Insurance Institute.

Columbus is working on regulations that would require drivers to register with the city, and the companies to have policies that cover drivers who lack adequate individual insurance. The city sued UberX last week to try to stop it from operating until rules have been finalized.

Taylor’s consumer alert raises questions about whether the services’ insurance includes coverage for medical payments, collisions and drivers who are uninsured or underinsured.

UberX and Lyft clarified their insurance policies in March after news-media reports about potential insurance gaps in the wake of a UberX driver striking and killing a 6-year-old girl on New Year’s Eve in San Francisco. UberX claimed no responsibility because the driver was between fares, but it has since modified its policy to cover drivers who don’t have a passenger.

Both companies provide $1 million in liability coverage and $1 million in uninsured- and underinsured-motorist coverage, according to blog posts on their websites. Lyft also will cover drivers between fares.

“The safety of Uber users and drivers is fundamental to our (principles), and we are proud that all UberX trips are insured end to end,” James Ondrey, Uber Ohio general manager, said in a statement.

Lyft officials could not be reached for comment.

Drivers should review their policy and that of their company, contact their insurance agent and consider buying a commercial auto policy with coverage for bodily injuries and property damage, according to the alert.

“It’s a service that’s out there, and it’s important that people, passengers and drivers understand important insurance considerations,” said Robert Denhard, spokesman for the state insurance department.